Moving Away From Your Values: Have Big Vendors Spread Themselves Too Wide?

Moving Away From Your Values: Have Big Vendors Spread Themselves Too Wide?

Times are hard in the unified communications (UC) and wider tech world right now. Unprecedented growth during the pandemic led many companies to expand and accrue debt, with the assumption that post-pandemic revenue would continue to increase. But as businesses reduce their tech stack in favor of one unified platform, stick with their current provider or — more shockingly — return to their on-premise PBX, many of the biggest UC vendors are struggling to hit their targets and pay off their creditors.

Beholden to their shareholders, companies like RingCentral, 8×8 and Mitel are grabbing every client they can through exclusive partnerships and M&As, without a care as to how those actions fit in with their brand position and mission statement. Competition and survival are on their minds, with little thought to the bigger picture.

But that means that the big vendors are serving wildly different markets and verticals, often with the same one-size fits all solution often cobbled together from their former competitors. They have left specialization behind in their mad dash to grab as much market share as they can. But will this generalist approach be enough?

The Power of Positioning

While we’ve talked about the benefits of specialization before, but let’s take a look at a real-world example of what happens when companies forget their roots and get caught up in the race to lead the market. To do this, we’ll step back from communications for a moment to look at another competitive market: pizza.

Pizza. Pizza.

When it comes to fast food, pizza is ubiquitous. Ordered for late work meetings, birthday parties or as a thank-you to your friends for helping you move, it’s a food that has a wide and diverse appeal.

Yet, not every pizza company markets their pizza the same way — and with good reason. Papa Johns recognizes that some customers care more about quality, hence its slogan “Better Ingredients. Better Pizza.”, while Domino’s focuses on availability and quick delivery. In each instance, they have found something that differentiates them from their competitors and thus lets them carve out a share of the national market.

In the 90s, fierce competition between the top three national pizza chains led both Little Caesar’s and Domino’s to forget what made them unique in their bid to outdo the competition. Little Caesar’s ended up dropping their clear value-for-money campaign, “Pizza! Pizza!”, while Domino’s created a pizza, the Dominator, that was so large it didn’t fit into any of its delivery cars (or its customers’ cars for that matter). As you can imagine, Domino’s super large pizza was a flop and Little Caesar’s market share eroded, dropping them from second to fourth place between 1994 and 2010. Of the two, Domino’s learned the most from the experience and decided to double down on their promise of fast deliveries by investing in more stores and technology, a move which eventually won them the number one spot.

There are two lessons we can pull from this example:

  1. Forgetting what sets a brand apart risks failure.
  2. Once customers have an idea about a brand, they are unlikely to change it.

And while these are points every marketer should know, we see vendors in the midst of making similar mistakes.

Zoom = Security?

In the early days of the pandemic, Zoom was everywhere. Its stable and easy-to-use videoconferencing platform allowed everything from businesses to dance classes to run remotely overnight, while its freemium service meant that families could keep in touch and friends run weekly pub quizzes. At that time Zoom’s mission statement was simple: “Make video communications frictionless and secure.” It’s descriptive, clear and succinct. And that was exactly what it delivered — except when its security wasn’t so secure.

As the market has moved away from stand-alone solutions in favor of UC, Zoom has tried to adapt by adding VoIP, calendars, chat and other features to its communication portfolio. To reflect this, the company has made its positioning statement much broader by dropping the word “video”. So now, it expects to differentiate itself with “make communications frictionless and secure.”

The issue is, it isn’t the most frictionless system and it certainly isn’t the most secure. Wildix, with its focus on WebRTC, creates much simpler and easy-to-use solutions, while Wickr, founded by security specialists, has always had data security and privacy in mind. When people think of Zoom, they think of video. They don’t think of frictionless or secure communications.

Zoom has set itself the difficult task of changing customers’ minds. They have quite an uphill battle to cement themselves as a one-stop shop for UC solutions, especially in this highly-competitive market.

The Danger of Generalization

On the opposite side of the coin, we have Microsoft which leads with the phrase: “Our mission is to empower every person and every organization on the planet to achieve more.” Talk about a statement that leaves no stone unturned.

Microsoft is the king of generalists, and it isn’t likely that they’ll go anywhere anytime soon. However, Teams Phone is a subpar solution for many. If you’re running a complex call center, Teams just doesn’t have the functionality you need. Microsoft knows this and has made it easier for other voice providers to fill the gap through its Direct Routing and Operator Connect programs.

It sounds like a good strategy, and it is, as long as the rest of the service is reliable. Just last month, Teams suffered a worldwide outage. Suddenly, millions of users lost access to communication and collaboration tools that are the core of their business. Those that were using Teams coupled with another provider, may have lucked out by being able to use the chat and videoconferencing features built into their specific UCaaS solution. All that has to happen is for those customers to realize that their voice provider’s solution is more stable and has the same features, if not more, than Teams, for them to decide to leave Teams, and potentially the whole Office suite, behind permanently.

For individuals and small businesses that find Teams’ service good enough, they may put up with an outage or two without immediately switching. But as hard as it is for consumers to change their minds about a brand through advertising, it takes just one bad experience to convince them to boycott the brand in the future. Bad service risks developing a bad reputation, which is something that is difficult to recover from.

That’s why it is so important to choose a focus and deliver the best customer experience possible. A large conglomerate like Microsoft could survive the failure of Teams, but a company like Mitel couldn’t. Doing everything and appealing to everyone, can, as Steve Osler, CEO of Wildix puts it, end “up doing very little at all”.

Where Does the Future Lie?

Right now, most vendors are focused on the here and now, not on the future. They are looking to put all existing technologies together under one roof to meet customers’ and shareholders’ current demands, as quickly as possible. That’s why mergers and acquisitions, not research and development, currently rule the day.

And that’s also why future innovation and disruption won’t come from the big companies. They have cast the net too wide. They’ve forgotten their roots and that true innovation comes from knowing your customer and improving their systems.

Remember, unified communications has to strengthen a company’s processes and connect people, partners and customers or it is not fit for purpose. What good is a cloud PBX if it doesn’t automatically log calls into your client’s CRM? And with CRMs varying widely between industries, let alone hardware and additional software needs, it is rare that a one-size-fits-all solution actually improves the flow of information throughout an organization.

In fact, a non-integrated system does nothing but increase repetitive tasks and encourage information silos. It doesn’t allow businesses to be agile enough to grow and adapt to ever-changing times. And if we’ve learned anything in the last three years it’s that times can change quickly.

As a vendor, or a managed service provider (MSP), choosing a vertical and catering to that industry doesn’t necessarily close you to other businesses. It means you are a specialist in your field.

Wildix, A Sales Specialist

Wildix, the first UC vendor that’s 100% focused on sales, provides truly unified solutions that come with a range of ready-to-use integrations covering multiple CRMs, Gong and even Veesion security cameras, all managed and delivered by our vetted partners.

From x-bees, our sticky communications channel that gets all decision makers into one place, to x-hoppers, our revolutionary headset solution that increases customer engagement and connects store staff to call centers and beyond, our 100% secure-by-design solutions increase productivity and revenue, changing communication systems into the core of a business.

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